The Fair Credit Reporting Act (FCRA) and the Fair Debt Collection Practices Act (FDCPA) govern the credit reporting industry in the United States, according to the Federal Trade Commission. These federal laws enable companies to report on-time payments and late or unpaid accounts. They also protect consumers from unfair credit reporting practices due to a dispute with a merchant or identity theft.
Applicable Time Frames
Incidents in which someone failed to pay their bills on time, or didn't pay then at all, can show legally on credit reports for seven years from the date of the missed payment, warns the Experian credit bureau. The seven-year period also applies to people who partially repaid their bills under a credit-counseling program or Chapter 13 bankruptcy. But some types of credit problems are legally reportable for 10 years, including Chapter 7 bankruptcy, tax liens and unpaid lawsuits. On-time payments to an open account, such as a credit card, report indefinitely as positive credit history. Once you close the account, the on-time payments will help your credit rating for at least 10 years from the closure.
Credit Report Privacy
The FCRA and the FDCPA prohibit people or companies from viewing your credit report without a "permissible purpose," notes the Federal Trade Commission. If you did not fill out an application for a job, home or loan, or do not have an existing account with a company, and someone pulls your credit report anyway, you can sue the company for each violation against your privacy. You also cannot legally view a family member's credit report without his consent.
Disputing Inaccurate Information
Creditors cannot willfully report false information to your reports, nor can credit bureaus like Equifax, Experian and TransUnion legally keep provably false data on your files, according to the FCRA. But you must first assert your rights over the telephone or in writing. The credit bureau or creditor to whom you complained has 30 days to complete an investigation into your request. If they cannot prove the accuracy of the reported information, they must remove it. If they allege the information is correct and you have evidence disputing that assessment, you can sue the agency in your local small claims court.
Other Types of Information
The FCRA enables other types of data to show on your credit report. Usually, your current and past addresses, current and previous employers, spouse's name, and your telephone number will appear on your report along with your full name, date of birth and Social Security Number. Every time a company views your credit report, this fact shows on your file for two years from that date.
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